What kind of house can I afford?

by Chris Lang on August 25, 2007

After the latest raise in interest rates everybody are talking even more about housing affordability crisis. The builders say that people who don’t already own a house (which they can sell) simply can not buy a house. “First home buyers just aren’t buying”, they say.

So how do you check what kind of house (if any) you can afford? First, you need to see how much money you can spend – to get an idea what your limits are. Probably a good idea would be to play with one of the mortgage calculators – here is an example.

Try setting different loan amounts and see how much money you will have to pay every month, based on that choose the amount that you can borrow and repay.

To see what the value of any kind of house is, you are going to need an estimate. As you know, any information in our time is for sale, so it will cost you – but try to pay as little as possible. You can get away with paying as little as $10 if you buy the “Guide to Property values” online and download it to your computer.

Don’t forget that the price of the house is only a part of your expenses. You have to pay for many additional things such as stamp duty, land tax, solicitor fees, mortgage application and registration fees, building inspection fees, etc. All of those are described really well here – click to see list of costs.

So add the extra expenses to the price of the house and you will end up a real cost of a house.

In the past few years I’ve been researching who are the successful agents, tried to figure out why top agents are top agents.
Do they have a common educational background? No. Good ones have high school diplomas, masters and doctorates. No correlation.
Similar previous careers? No. One of the best agents I know used to teach baton twirling. I doubt if I could find a lot of those if I tried! I’ve had waiters, teachers, high powered executives and stay-at-home Moms who were all very successful.
Common interests? No. Other than eating, (which we Realtor-types seem to do exceptional well) the interests are widely diverse.
After 13 years in real estate sales and management, I’ve only found a few constants.
1. Successful agents treat the real estate business as a business. They actually have a business plan and a budget. They understand that you have to spend money to make money. They know how many sales they need to make the income they require and then they figure how they’ll get from here to there. They plan in advance and execute the plan.
2. They actually work when they work and play when they play and take a day or two off every week. (Just like a "real job!")
3. They have fun and enjoy selling real estate but know that it won’t be forever.
4. They buy a lot of real estate for investment when they see good deals because they know that no one gets rich selling the stuff. You get rich owning it! Financial independence gives one a lot of freedom, autonomy and a certain air of confidence that smells like success.
. . . And people like to do business with successful people so they do more business!
That’s why I choose this realtor http://www.realtydirectorymakers.com/ for my future